Prozone Realty Limited , a prominent real estate developer, is pursuing a strategic expansion into tier-2 cities with a focus on mixed-use projects aimed at long-term value creation. The company's latest financial results for Q2 FY26 reflect this strategy, showing stable performance and continued emphasis on retail and residential developments.

Expansion Strategy

Prozone Realty is actively developing large-scale mixed-use projects in tier-2 cities, capitalizing on the urbanization trends in these areas. The company's approach involves allocating 75% of its land for residential and commercial developments under a build-and-sell model, while the remaining 25% is dedicated to retail spaces following a build-and-lease model.

Retail Performance

The company's retail segment continues to show resilience, with stable occupancy rates:

• Ch Sambhaji Nagar Mall: 93% leased (excluding lower ground floor)
• Coimbatore Mall: 96% leased

These high occupancy rates underscore the strength of Prozone Realty's retail portfolio in tier-2 markets.

Residential Projects

Prozone Realty's residential projects are gaining traction:

• Coimbatore Residential: Received 38 new bookings worth Rs 234.00 million in Q2 FY26
• Nagpur Residential: Completed 4 towers with 336 apartments, with part occupancy certificates obtained for 242 units

Financial Highlights (Q2 FY26)

• Total Income: Rs 4,912.29 million
• EBITDA: Rs 204.10 million (24% increase year-over-year)
• Net Profit: Rs 34.20 million (increase from Rs 3.90 million in Q2 FY25)

Segment-wise Revenue

The company's CEO stated, "Our focus on mixed-use developments in tier-2 cities is yielding positive results. We are maintaining stable retail occupancy above 90% while strategically launching residential phases to enhance cash flows."

Prozone Realty's strategy of balancing rental income stability from its retail assets with the cash flow generation from residential and commercial sales positions the company for growth in India's evolving real estate market.

As the company continues to expand its asset portfolio and capitalize on the urbanization trends in tier-2 cities, investors and stakeholders will be watching closely to see how this strategy unfolds in the coming quarters.

Prozone Realty Limited has announced its financial results for the quarter ended September 30, showcasing a significant improvement in profitability despite a slight dip in revenue.

Key Financial Highlights

• Net Profit: The company reported a consolidated net profit of Rs 341.92 lakhs for the quarter, marking a substantial increase from Rs 39.41 lakhs in the same quarter last year.
• Revenue: Consolidated revenue from operations stood at Rs 4,618.77 lakhs, down 5.5% from Rs 4,885.72 lakhs in the corresponding quarter of the previous year.

Operational Updates

Management Changes

• The Ministry of Corporate Affairs rejected the company's application for re-appointment of its Deputy Managing Director under Section 196 of the Companies Act, 2013.
• The rejected director ceased to hold the position and was redesignated as Non-Executive Director.
• Prozone Realty is evaluating legal recourse and determining action for Rs 682.00 lakhs in remuneration and salary advances paid to the director from February 27, 2020 till the rejection order date.

Subsidiary Update

Hagwood Commercial Developers Private Limited, a subsidiary of Prozone Realty, continues to contest the cancellation of aviation clearance for its Nagpur residential project. The management believes the chances of revalidation are high based on recent court orders.

Financial Table

The company has shown significant improvement in profitability amid revenue challenges, indicating a complex operating environment.